5/2/07

Australia to 'reinvigorate APEC' through reform

Riyadi Suparno, The Jakarta Post, Sydney

Australia, the host of the upcoming Asia Pacific Economic Cooperation (APEC) summit, has vowed to reinvigorate the forum through a series of reforms designed to ensure the achievement of the Bogor target of free trade in the region by 2020.

David Spencer, Australian Ambassador to APEC and chairman of the APEC senior officials' meeting (SOM), unveiled on Tuesday the major agendas that will be pursued during the APEC summit here in September, including a proposal to reform the APEC secretariat and establish a policy-support unit.

He noted that APEC is not a negotiating forum, but rather a forum for cooperation and dialog -- something that often makes it more effective in achieving real targets, such as reducing trade barriers.

But the process was described by Spencer as a "stop-and-start process", meaning that every time a member takes over the APEC leadership, it tends to introduce a new focus and new goals, thereby hampering APEC in its efforts to achieve targets.

He said Australia would propose the establishment of the more permanent post of executive director of the APEC secretariat based in Singapore, rather than the current annual rotating system, to provide more professional leadership of the secretariat.

In addition, Spencer said that Australia would propose an increase in member country contributions of up to 30 percent to strengthen the secretariat as there had been no increase in the size of contributions for the past few years.

"We are running on a shoestring budget of about $3.5 million in total (per annum). It's a disgrace in many respects that a grouping like this can only afford this amount," he said.

Also regarding the secretariat, Australia planned to propose the establishment of a policy-support unit, consisting of economists, to provide suggestions and recommendations on the reform agenda, especially for developing members, so that the APEC forum can achieve free trade by 2010 for developed economies and 2020 for developing economies, as mandated by the Bogor declaration. "So, we are still committed to Bogor," Spencer said.

Mark Johnson, chairman of the APEC Business Advisory Council, welcomed Australia's proposal to reform the APEC secretariat and introduce a policy-support unit, saying that it would help guide APEC economies in achieving targets and supporting business supply-chain networks.

He suggested that APEC look beyond trade barriers, saying that an integrated APEC market would need integration not only in the free flow of trade in products, but also the free flow of trade in services and investment.

"So, we need to look at broader reforms that will facilitate an integrated APEC market, covering trade in services, investment and products," Johnson said.

Spencer welcomed Johnson's suggestion and noted that the upcoming APEC summit would address concerns from business, and focus on reforming the domestic policies of each member economy.

Reforming domestic policies would address not only trade barriers but also other issues that could impede the growth of trade in all sectors, such as lack of transparency, corruption and poor governance, which all impede growth in the same way as trade barriers.

However, Spencer said that this did not mean Australia wanted to see APEC become a body that could intervene in domestic policy. "We are a forum for sharing experiences, a peer-exchange forum at the senior and technical levels on how to bring down tariff barriers, how to increase trade and investment. This is not a peer-pressure forum," he said.

Spencer noted that in the area of trade in goods, APEC had made some progress, cutting tariffs by two-thirds from 16.5 percent on average in 1989 to a bit above 5 percent on average now. Some developed members had even lower tariff lines.

In the immediate future, Spencer noted, the leaders assembled at the upcoming APEC summit would commit themselves to helping bring the multilateral Doha Development Round trade negotiations to a conclusion. "For us, Doha is our immediate target, Bogor is our mid-term target and total free trade in Asia Pacific is our ultimate target," he said.

In September, also in Sydney, Spencer said, APEC leaders would formulate a coherent regional policy response to issues related to climate change, such as coordinated efforts to secure energy supplies in a sustainable manner and promote low-emission technology so as to reduce greenhouse gas emission.

Spencer also noted that the APEC summit would press ahead on human security issues, including counterterrorism measures, efforts to secure trade flows, and plans for tackling pandemics.

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"Australia and NZ remained unrepentant for their brutal suppression of indigenous independence movements in the Pacific. They rationalized such behavior as enhancing the welfare of the Islands and the human development of their people – just as they justified similar behavior towards indigenous peoples in their own countries"